Data collection and analysis have always been crucial components of business organizations. However, the process of collecting, analyzing, and putting data to relevant use has undergone significant change since the 1990s. What earlier used to be a specialized field restricted to hardcore computer skills has become more ubiquitous. Today, almost every sector and industry leverage the potential of business analytics to uncover data insights.
So, what is business analytics, and what is the scope of a career in business analytics? Read on to find out all about this thriving field.
What Is Business Analytics?
Business analytics is the process of collecting and processing past business data, analyzing the data to identify patterns and trends, and using the insights to make data-driven business decisions.
Business analytics is often used interchangeably with business intelligence (BI). However, the two are fundamentally different. Business intelligence uses descriptive analysis on current and historical data to determine what happened in the past, the current situation, and the opportunities for future improvements. On the other hand, business analytics builds upon the findings of BI to predict future trends. It uses data mining, predictive analytics, data visualization, and various different methodologies to generate actional insights for stakeholders and decision-makers.
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Elements of Business Analytics
Business analytics includes a set of methodologies, technologies, and practices that help organizations transform data into valuable insights, predict trends, and make data-driven business decisions. Below is an overview of the typical elements in the business analytics lifecycle:
- Defining objectives: The first step involves determining the business objectives, the problem that requires solutions, and mapping data requirements.
- Data aggregation: A critical step before analysis, data aggregation means collecting the data, organizing, and filtering it.
- Data cleaning: It is essential to clean data to make it usable and compatible with further analytical procedures. Thus, data cleaning involves fixing or eliminating corrupted, incorrect, or incomplete data in a dataset.
- Data mining: Business analysts sort through the datasets to identify trends and patterns once the data is organized and cleaned. The analytical methodology employed will depend on the business goal.
- Forecasting: It involves the analysis of historical data to make educated estimates of future trends or behaviors.
- Predictive analytics: Predictive analytics employs different statistical techniques to build predictive models which can be used for information extraction and pattern identification from datasets.
- Reporting and data visualization: A critical aspect of business analytics is communicating complex insights to stakeholders in an easy-to-understand format. Graphs and charts are quick and efficient techniques to represent outcomes and simplify data analysis visually.
On a broader scale, business analytics methods include:
- Descriptive analytics to analyze historical data and describe what happened.
- Diagnostic analytics to discover the root cause of a past trend or observation.
- Predictive analytics to determine the likelihood of future outcomes.
- Prescriptive analytics to determine the best possible course of action to achieve objectives.
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Business Analytics Tools
Understanding the tools of the trade is crucial to master any skill, and it is no different for a career in business analytics. Business analytics have various tools and technologies at their disposal to help them pull out actionable insight from data. Today’s sophisticated business analysis tools are packed with powerful functionalities for efficient and convenient data collection, analysis, and visualization.
Below is a list (not exhaustive) of some of the most common business analytics tools used globally:
- Microsoft Excel
- Power BI
- IBM Cognos
- Xplenty and many more!
Roles and Responsibilities of a Business Analyst
Business analysts are the backbone of business-IT collaboration. It is upon business analysts to identify objectives, determine requirements, and understand how data can add value and efficiency to business processes, products, and services. Business analysts are also responsible for communicating data-driven insights to executives and stakeholders.
Let’s look at some of the core roles and responsibilities encompassing a business analyst’s job description:
- Creating a detailed analysis and evaluation of the current business processes of an organization
- Outlining problems and identifying areas that require improvement
- Defining business requirements and communicating them to stakeholders
- Staying up-to-date with the latest IT advancements and business processes to modernize systems
- Developing optimization strategies and leading business process reviews
- Documenting and presenting plans, ideas, and insights to team members and management
- Providing guidance and training to team members and staff
- Developing and managing projects and monitoring performance
- Allocating and managing resources while maintaining cost-efficiency
- Creating initiatives as per business needs and requirements
- Collaborating with stakeholders and users
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What Is the Scope of a Career in Business Analytics?
The global business analytics market is forecasted to reach a whopping USD 103.65 billion with a CAGR of 7.3% during 2021-2026. Business analytics has far-reaching implications and uses across all industrial domains. From finance and agriculture to manufacturing and supply chain operations and more, business analytics has become a widespread tool to process business data and make informed decisions. Moreover, the evolution of AI, cloud data management software, and self-service business analytics programs have made it possible to analyze data and visualize trends in real-time with utmost ease.
Below is a list of the top industrial applications of business analytics:
- Government and public sector
- Energy and Fuel
- Human Resources
- Entertainment and media
Virtually every industry out there has applications of business analytics. As a result, every industry needs business analysts who can positively impact business processes and outcomes through data-driven insights.
A career in business analytics has ample scope for professional and financial growth. However, business analysts may not have a straightforward future career path since professionals can explore diverse avenues and opportunities with their skill sets.
Below are some of the most popular job titles business analysts are eligible for:
- Functional analyst
- Process analyst
- Information technology manager
- Product manager
- Project manager
- Business consultant
- Systems analyst
- Information architect
Companies worldwide now realize the importance of business analytics to stay ahead in the competition. Naturally, business analysts have a vital role in steering an organization towards success. Apart from having domain knowledge and the relevant technical skills, it is crucial that business analysts have the requisite soft skills along with the necessary theoretical and practical knowledge. Furthermore, aptitude, patience, creativity, and communication skills enable business analysts to mobilize and engage human resources for reaching business objectives.
Today, business analytics has become a sought-after course in leading institutions and B-schools that teach students to apply business analytics skills to real-world situations. However, if you want to grab the best opportunity of becoming a business analyst, upGrad offers an online Business Analytics Certification Program. Learn in-demand and industry-relevant skills such as business problem solving, statistics, data analytics, predictive modeling, and more within three months!
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1. What are the different types of business analytics?
Business analytics can broadly be classified into the following types: Descriptive analytics, Diagnostic analytics, Predictive analytics, Prescriptive analytics
2. Does business analytics require coding?
Although business analytics primarily focuses on statistical tools and software, the ability to code proves beneficial for a career in business analytics. Moreover, business analytics tools such as Python, R, and SQL require some programming knowledge. However, coding requirements may vary depending on the organization and job description.
3. What are examples of business analytics?
Business analytics has applications in almost every industry today. Some of the real-life examples where business analytics finds use include developing market strategies, improving financial efficiency, streamlining processes, increasing sales, enhancing customer support, targeting consumers, and forecasting orders.